Recent Developments in EU Merger Remedies (2020)

Abstract

The year 2020 marked the 30th anniversary of the EU Merger Regulation.1 Over the years, the Commission has received notifications for more than 8,000 transactions, of which it has prohibited less than 1 per cent (including Phase II withdrawals).2 This is at least partly attributable to the Commission’s enduring willingness to clear a substantially higher share of transactions (approximately 6 per cent)3 subject to remedies designed to preserve competition. But the Commission’s experience has shown that, as with any artificial intervention in the market, the ‘potential for things to go wrong is high: the business to be sold as a remedy can be composed of the wrong assets, it can be sold to the wrong purchaser or the business can deteriorate during the divestiture process or afterwards’.4 The Commission has developed a rigorous yet pragmatic approach to merger remedy design and implementation to minimise those risks. As former Deputy Director-General for Mergers, Esteva Mosso, has explained, that approach is ‘in constant evolution’,5 as the Commission calibrates its policy based on learnings from past cases and changes in economic circumstances. This year’s vintage of conditional clearance decisions illustrates this yet again. The Commission was attentive to the implications of the COVID-19 pandemic and open to innovative solutions in appropriate cases, while resisting calls to substantially overhaul its remedy policy in the wake of its widely debated prohibition decisions in the 2019 ‘European Champions’ saga.6 Four trends were particularly noteworthy in 2020.